SIRE reports reduced revenue, increased ethanol production

Southwest Iowa Renewable Energy has released financial results for the fiscal first quarter of 2018, the three months ended Dec. 31, reporting net income of $1.2 million, or $88.62 per unit, down from $5.6 million, or $422.60 per unit, for the same period of the previous year.

Revenue from operations reached $50.5 million during the first quarter, down from $52.1 million during the same period of fiscal year 2017. Modified EBITDA was $4.2 million, down from $8.2 million during the first quarter of fiscal 2017.

“This first quarter of fiscal 2018, we saw very tight margins, continuing the trends of the previous quarter,” said Brian Cahill, president and CEO of SIRE. “Corn prices are down slightly per bushel as compared to the first quarter of fiscal 2017. However, ethanol prices in the U.S. have been trending downwards over the past twelve months. Demand for ethanol has been strong with the lower prices, both in the U.S. and abroad. The industry has continued to adjust and we expect margins to remain positive but are becoming more dependent on continued good export demand. Our distiller grains have also seen increased demand offset by reduced prices, and a shift to a heavier weighting of wet distiller grains."

SIRE reported producing 31.7 million gallons of ethanol during the first quarter of fiscal 2018, up from 29.9 million during the same quarter of the previous year. “We continue to evaluate and implement new production technology,” Cahill said. “We will continue to focus on running the plant efficiently, increasing our ethanol yield, with a balance of optimizing the yield and profit."

During the first quarter, SIRE earned $39.72 million in revenue for denatured and undenatured ethanol sales, accounting for 78.6 percent of revenue. During the first quarter of fiscal 2017, the company earned $41.61 million in revenue from these products, accounting for 79.9 percent of quarterly revenue.

SIRE reported $8.03 million in revenue from distillers grains, accounting for 15.9 percent of revenue. During the same period of last year, the company earned $7.94 million in revenue from distillers grains sales, accounting for 15.2 percent of revenue.

Approximately $2.56 million in revenue was reported for corn oil in the first quarter of fiscal 2018, accounting for 5.1 percent of total revenue. During the same period of last year, SIRE earned $2.28 million in revenue from corn oil, accounting for 4.4 percent of revenue.

Other products accounted for $237,000, or 0.4 percent of revenue, during the first quarter of fiscal 2018, compared to $238,000, or 0.5 percent of revenue, during the first quarter of fiscal 2017.